The recent weakness has left Turkey's stock market trading at a forward price-earnings multiple of around 11, estimates Global X, which doesn't run a Turkey specific ETF. By comparison, China's is trading at a multiple of about 14, Chile's at 17 and Colombia's approaching 19, adds Ashby.

The country's fundamentals seem to be improving. Last month's award of the World Cup soccer championship to Russia and Qatar should help Turkey's already-robust construction sector.

"We feel like Turkey is relatively well governed compared to other emerging markets," says Ashby. "And it has a well-educated, youthful population with a relatively low-cost labor force."

Still, tapping into the vast potential of Turkey comes with risk. "The challenge for Turkey in 2011 will be to tame inflation, which was 7.3% last month," says Tom Lydon, president of Global Trends Investments, a money-management firm.

The country is battling a growing current-account deficit that stood at $36 billion in October, up by a triple-digit percentage amount in the last year. With imports surging and exports dwindling, Turkey's central bank last month cut interest rates to 6.5%, down from more than 16% just two years ago. And, in a move mirroring China's attempt to control growth, Turkey hiked bank-reserve levels to curb speculative lending. Because nearly 52% of the MSCI Turkey index is in financials, the tightening on credit has an outsize market effect.

The tightening will curtail growth. The International Monetary Fund forecasts growth slowing to roughly 4.5% in 2011, about half its rate for most of 2010.

Even with the fourth-quarter dip, there's still some price risk in stocks. Lydon notes that TUR is trading above its 200-day moving average, a key technical level.